6 ms·

"It seems that while these firms do sell concrete consulting services to their customers, what they are mostly selling is a prestigious aura around that advice.

• arethuza 6y ago
  "The change program will have a random impact" The book Rip-Off: The Scandalous Inside Story of the Management Consulting Money Machine by David Craig mentions one firm of management consultants (called The Butchers - he doesn't give names of consultancies for obvious reasons) who apparently only ever make one recommendation: lay off a quarter of your staff. Regardless of what the problems of the client are or even if they have any problems. This makes the job of the management consultants easier - they know what the answer is, they just need to gather some plausible sounding data to support it (or make it up). The amazing thing is that this, from the viewpoint of an executive, will actually work for a few years - numbers will look great and the company will survive long enough for the executives to move on based on their track record of being "turn around" experts at their last company.
  • kubanczyk 6y ago
    That's bold, a usual recommendation is 10%.
    • the-dude 6y ago
      That makes your decisions look mediocre, you want to look bold.
      • arethuza 6y ago
        Confident, decisive and bold. Edit: I know from experience that in a lot of sales situations a pitch that is delivered confidently, decisively (with no "It depends") and boldly will pretty much always beat a technically better pitch delivered less boldly.
    • arethuza 6y ago
      The book is from 2005 and is based on the authors experiences from a career in consulting so that could be from the 1980s. Somehow I don't think the details have changed and I've actually witnessed people in a meeting room in a shared office building doing the brown paper trick fairly recently!
      • dtech 6y ago
        brown paper trick?
        • arethuza 6y ago
          It's a way of doing process mapping: https://www.ifm.eng.cam.ac.uk/research/dmg/tools-and-techniques/process-mapping-brown-paper/ https://www.ifm.eng.cam.ac.uk/research/dmg/tools-and-techniq... However, what is neat is how management consultants can use this as a sales weapon - that books describes it how to use it that way.
  • dalbasal 6y ago
    Maybe it's better than tailored advice. These guys probably get hired in cases where downsizing is the desired answer. The way big, obvious decisions get made gets a lot of scrutiny. They're litigated, literally and otherwise. It's pretty hard to go into major layoffs without a "no choice" mentality. The advice might create an air of certainty, help with labour courts, settle dissent in management, etc. It might play an "explored-all-alternatives" role, etc. It's the type of thing we never hear a full throated defense of, because these things don't ever work without some level of ambiguity.
    • arethuza 6y ago
      The book is fairly even handed in general about management consulting - but it does emphasise that the "Butchers" strategy can often be good for executives but bad for shareholders.
  • ackbar03 6y ago
    I've read of this other view that the true value of management consulting is hiring an outside group of people to tell you what you want to hear so the executives can justify their decisions to the shareholders / board / whatever. I guess from this perspective it makes sense that such a firm operates that way. If a company wants to layoff people but is worried about PR or whatever they can hire this firm who they know is going to tell them to layoff people
  • wegs 6y ago
    There's a bias there. You often hire consulting firms to do specific things. If you're hiring PWC to do a Fit For Growth Transformation, that means you believe you need layoffs. The symptoms of are usually obvious: you're burning money, and you'll run out soon. They can be less obvious: You lose contracts based on cost, because your overhead is hire. You don't hire the PWC/FFG team if you believe you're poised for actual growth or need help hiring to move into new markets. You can get their book. It says point-blank that FFG generally involves a 25% layoff. This isn't some big secret or inside story. It's just what they do. The advertised value-add of PWC/FFG isn't to tell you that you need a layoff (you knew that already). The value-add is understanding how to structure that layoff. An ideal outcome of a layoff is that you've cut the corporate fat: people doing useless things with no value add. You've removed a big chunk of the corporate bureaucracy. You have faster, simpler, more agile business processes. When you want to do something, you don't need a 3-month approval from Jim in legal, Alice in finance, and Yoav in branding, since Jim, Alice, and Yoav no longer work there. On the other hand, parts of your business which contribute business value are left untouched. Does it work? I don't know. But most executives go through this occasionally. As an executive, you're an expert on your own business. PWC/FFG has done layoffs over and over and over again. They've seen what can go right and what can go wrong. You're paying for that experience.
    • arethuza 6y ago
      I suspect that if the company is that inefficient and badly run it's not the rank and file that are the problem but the people around the boardroom table.
      • fakedang 6y ago
        Or middle management. Most of the fat trimmed could be MM.
        • arethuza 6y ago
          That implies that senior managers can't work out who in their own organisation is performing or not. Which rather questions their competence as senior managers?
• woah 6y ago
  Why does this comment have such a complaining vibe? It’s B’s money, B can hire whatever combination of A and C they want to get the work done.
  • sgt101 6y ago
    It's not B's money, B is managing other peoples money, B is a pension fund.
• deleted 6y ago
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